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Lack of information on Scottish independence impacting oil and gas businesses

Hydrocarbon Engineering,

The 19th Oil and Gas Survey, conducted by Aberdeen & Grampian Chamber of Commerce and sponsored by law firm Bond Dickinson, demonstrates a short term positive outlook for the sector. Confidence in the industry looks high for 2014.

The survey reveals that 58% of operators and 65% of contractors increased their headcount in the past year. Meanwhile, average pay has increased by approximately 6.5% for operators and 4.8% for contractors. These figures are above the national average.

Despite this, the majority of companies report difficulties in recruiting and retaining staff. 75% of operators and 68% of contractors said that they are suffering from recruitment difficulties.

The Scottish referendum is considered a key issue governing the future of the industry. Oil and gas executives feel that there is a lack of clarity on issues such as tax (both personal and corporate), regulatory issues and the position of Scotland in the EU should the referendum result in independence.

The executives claim that a lack of information is seriously hindering their ability to establish business plans beyond 2014. Hence, the long term outlook for the industry is much less clear.

Kenny Paton, oil and gas partner at Bond Dickinson, said ‘more and more of [their] clients in oil and gas and other sectors are raising questions about the implications of the result of the referendum, and this report provides evidence that oil and gas businesses are concerned about this lack of information. The main issues that [Bond Dickinson] are being approached about involve personal and corporate tax issues and fiscal policies, but a yes vote would impact companies in a number of ways that they need to factor in to their business planning’.

Robert Collier, chief executive at the Aberdeen and Grampian Chamber of Commerce, also commented on the findings of the report, highlighting that ‘the good news is that the sector and the north east continue to see record levels of activity.’

The survey demonstrates the ‘highest ever reported level of companies recruiting in the contracting sector. This brings challenges around how vacancies will be filled but [Aberdeen and Grampian Chamber of Commerce] fully expect the sector to meet these challenges and continue to deliver for the north east, Scotland and UK economies’.

For further survey findings, see also 'Oil and gas growth hampered by skills shortages'.

Adapted from a press release by Emma McAleavey.

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